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  S.B. No. 551
 
 
 
 
AN ACT
  relating to liability for interest on ad valorem taxes on
  improvements that escaped taxation in a previous year.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 26.09, Tax Code, is amended by amending
  Subsection (d) and adding Subsections (d-1) and (d-2) to read as
  follows:
         (d)  If a property is subject to taxation for a prior year in
  which it escaped taxation, the assessor shall calculate the tax for
  each year separately.  In calculating the tax, the assessor [he]
  shall use the assessment ratio and tax rate in effect in the unit
  for the year for which back taxes are being imposed.  Except as
  provided by Subsection (d-1), [To] the amount of back taxes due
  incurs[, he shall add] interest calculated at the rate provided by
  [Subsection (c) of] Section 33.01(c) [33.01 of this code] from the
  date the tax would have become delinquent had the tax been imposed
  in the proper tax year.
         (d-1)  For purposes of this subsection, an appraisal
  district has constructive notice of the presence of an improvement
  if a building permit for the improvement has been issued by an
  appropriate governmental entity.  Back taxes assessed under
  Subsection (d) on an improvement to real property do not incur
  interest if:
               (1)  the land on which the improvement is located did
  not escape taxation in the year in which the improvement escaped
  taxation;
               (2)  the appraisal district had actual or constructive
  notice of the presence of the improvement in the year in which the
  improvement escaped taxation; and
               (3)  the property owner pays all back taxes due on the
  improvement not later than the 120th day after the date the tax bill
  for the back taxes on the improvement is sent.
         (d-2)  For purposes of Subsection (d-1)(3), if an appeal
  under Chapter 41A or 42 relating to the taxes imposed on the omitted
  improvement is pending on the date prescribed by that subdivision,
  the property owner is considered to have paid the back taxes due by
  that date if the property owner pays the amount of taxes required by
  Section 41A.10 or 42.08, as applicable.
         SECTION 2.  Section 31.01, Tax Code, is amended by adding
  Subsection (c-2) to read as follows:
         (c-2)  For a tax bill that includes back taxes on an
  improvement that escaped taxation in a prior year, the tax bill or
  separate statement described by Subsection (c) must state that no
  interest is due on the back taxes if those back taxes are paid not
  later than the 120th day after the date the tax bill is sent.
         SECTION 3.  The change in law made by this Act applies only
  to an omitted improvement included in a tax bill that is first sent
  to the property owner on or after the effective date of this Act.
         SECTION 4.  This Act takes effect September 1, 2011.
 
 
 
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
         I hereby certify that S.B. No. 551 passed the Senate on
  April 7, 2011, by the following vote:  Yeas 31, Nays 0.
 
 
  ______________________________
  Secretary of the Senate    
 
         I hereby certify that S.B. No. 551 passed the House on
  May 11, 2011, by the following vote:  Yeas 134, Nays 1, two
  present not voting.
 
 
  ______________________________
  Chief Clerk of the House   
 
 
 
  Approved:
 
  ______________________________ 
              Date
 
 
  ______________________________ 
            Governor